Having a smooth retirement isn’t just going to be a wishful thing. It definitely will not happen by chance. It is a continuous and deliberate effort of the prospective, especially while in active service. As a Retirement Savings Account (RSA) holder, you must do everything possible to make this happen. You will be doing yourself a great service by detecting early enough all the possible bottlenecks that could hinder your smooth retirement experience.
It doesn’t matter if you are just starting work, already working or you are about to retire. The most important thing is to detect early enough all those matters that could cause you delays in accessing your retirement benefits or those things that could cause your retirement savings to be undervalued due to some avoidable oversights or mistakes.
4 things to watch closely as an employee concerning your RSA Contributions
As an RSA holder, you must watch out for the following and take every step to correct them if you are already caught up in any of them. The aim is to allow you to reduce or eliminate all those avoidable factors that could hinder you from having a happy retirement experience.
1. Employment letter without any breakdowns:
It is very crucial for employees to monitor the state of their pension deductions especially while they are still working with the employer.
This will ensure that all necessary corrections and updates are made in earnest to avoid any future challenges that may ensue while trying to access part or whole of the retirement benefits.
An employment letter without the breakdowns like your Basic salary, Housing allowance, Transportation allowance, etc will make it difficult for you to determine how much of pension deduction would be deducted and remitted to your PFA.
2. Delay or non-remittance of pension deductions by the employer:
When your pension is being deducted but there is always a delay in remittance or even non-remittance by the employer, there is a problem.
As an RSA holder, you are definitely being denied the possible growth from the due date to the eventual time it will be remitted.
It is important to monitor the monthly remittances latest by the 7th working day after the salary has been paid because that is what the law says.
3. Under-remittances of pension deductions:
There are loads of good and responsible employers out there. There are equally some bad ones too.
Some employers of labour have devised means through which they sometimes rip off some employees of their rightful pension contributions.
Some go as far as deducting the employee’s pensions contributions while failing to remit the same to their PFAs. Others even cleverly termed the employee deductions as representing both Employer and Employee contribution portions.
As the employee of concern, you are advised to ask questions from the payroll or finance department about why this is so, and definitely, it is not allowed under the pension law.
4. Inability to access Payslips or non-issuance by the employers:
The above-discussed issues directly connect to this one. Not having access to Payslip has made it difficult for some employees to even know what is being remitted and what should be remitted.
If as an employee you don’t have access to your payslip, it becomes difficult to fully understand what and how frequently your contribution is being made on your behalf by your employer. However, you can verify this with your PFA by requesting your RSA statement.
Notwithstanding, the payslip is also important as it will corroborate what you have in your RSA statement. It can also help in reconciliation matters. Why would an employer not issue the employee a payslip? It’s a red flag an employee should watch out for.
The above are the major red flags to watch out for as an employee regarding your pension matters with the employer.
All necessary steps should be taken to correct or avoid the above from happening or continuing. It is, however, advised that such corrections should be done while still with the employer as it becomes difficult to be corrected when the employee has already left.
Your Retirement is your “Cup of Tea”
Having a wonderful retirement starts from the days in active service as it becomes difficult when it is attempted to be corrected when you are already retired. Your future is in your hands now and it is your responsibility to monitor the process religiously.
In conclusion, as an employee with an RSA, it is advisable that you do the following regularly to avoid being denied your rightful entitlements:
1. Always demand for your payslips when it is not being issued to you.
2. Know the breakdowns of the total package on your employment letter to determine how much will be remitted as pension contributions on a monthly basis.
3. Check your RSA statement regularly from your PFA to monitor the frequency at which your pension contributions are being made.
4. Follow up on your pension remittance after salary payment especially when it is over 7 days after payment.